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Ralcorp (RAH) said today it plans to receive about $900 million in connection with the tax-free spin-off of its Post cereal business.

The company updated its previously announced plan to separate the business, which will create a new competitor for General Mills (GIS) and Kellogg (K).

Ralcorp said it will retain up to 20% of the outstanding shares of Post once it is spun off to shareholders, and will use the proceeds of the transaction to reduce debt, pursue private brand acquisitions and make additional share repurchases.